Looking to retire in paradise? Florida might just be your ideal destination. With its enticing tax benefits for older workers and retirees, the Sunshine State stands out as one of the most tax-friendly havens in the U.S. Here’s a breakdown of what makes Florida a prime retirement spot:
Income Tax: 0 percent. That’s right, Florida doesn’t collect personal income tax at the state or local level, allowing residents to enjoy tax-free pensions, retirement pay, Social Security benefits, and investment income.
Property Tax: While property taxes vary by county, the average rate in 2021 was 0.91 percent of a home’s assessed value. Plus, Florida offers a homestead exemption of up to $50,000 for permanent residents, along with additional discounts for seniors, veterans, and disabled individuals.
Sales Tax: With an average combined state and local sales tax rate of 7 percent, Florida’s sales tax applies to most consumer goods and services. However, some essentials like groceries and prescription medicine are exempt, providing relief for retirees.
Investment Income: Capital gains and dividends are not taxed at the state or local level, making Florida a haven for investment growth and wealth accumulation.
Social Security Benefits: Florida doesn’t tax Social Security benefits, although federal taxes may apply depending on your income level.
Estate and Inheritance Tax: None. Your heirs won’t have to worry about paying taxes on inherited assets in Florida.
From property tax breaks to income tax exemptions, Florida offers a wealth of financial advantages for retirees. With its sunny weather, diverse attractions, and vibrant communities, it’s no wonder why so many choose to call Florida home during their golden years.